India's energy security has come under fresh scrutiny after a new report revealed that the country's strategic crude oil reserves can meet national demand for only 9–10 days. The findings have raised concerns about India's vulnerability to global supply disruptions, especially given its heavy dependence on imported energy.
According to a report released by the Council on Energy, Environment and Water (CEEW), India remains significantly behind several major Asian economies in terms of strategic energy preparedness despite being one of the world's largest oil consumers.
The report highlights the urgent need for stronger energy storage infrastructure and long-term planning to safeguard the country's economy from future supply shocks.
India Relies on Imports for More Than 85% of Its Oil Needs
India imports the majority of its crude oil requirements from overseas markets.
The report notes that over 85% of India's crude oil imports come from just six countries, including Russia and several West Asian suppliers.
This concentration of supply sources creates potential risks if geopolitical tensions, trade disputes, sanctions, military conflicts, or logistical disruptions affect global energy markets.
Experts warn that excessive dependence on a limited number of suppliers could expose India to sudden price volatility and supply shortages.
Strategic Oil Reserves Far Below Global Peers
One of the most significant concerns highlighted in the report is the limited size of India's strategic petroleum reserves.
Strategic Reserve Comparison
India: Approximately 9–10 days of crude oil demand
Japan: More than 200 days of strategic reserves
South Korea: More than 200 days of strategic reserves
These reserves are designed to help countries withstand temporary disruptions in global oil supplies and stabilize domestic markets during emergencies.
The report suggests that India's current reserve capacity may not be sufficient to address prolonged supply disruptions.
Natural Gas Storage Remains a Major Weakness
Apart from crude oil, the report also identifies natural gas storage as another area of concern.
Unlike several developed energy-importing nations, India currently lacks dedicated strategic gas storage infrastructure.
Experts believe this creates vulnerabilities for sectors heavily dependent on natural gas, including:
Fertilizer manufacturing
Industrial operations
Power generation
City gas distribution networks
Transportation fuel systems
Any disruption in global LNG supplies could affect both industrial activity and consumer energy access.
Potential Economic Impact of Supply Disruptions
According to energy experts, disruptions involving crude oil, LNG, LPG, coal, or major maritime trade routes could have widespread economic consequences.
Potential impacts include:
Higher fuel prices
Increased LPG costs
Rising transportation expenses
Greater fertilizer subsidy burden
Inflationary pressures
Supply shortages in critical sectors
Such disruptions could directly affect household budgets, industrial production, and overall economic stability.
Experts Recommend Strengthening Energy Security
The CEEW report outlines several recommendations aimed at improving India's long-term energy resilience.
Expand Natural Gas Storage Capacity
Experts suggest accelerating the development of strategic gas storage facilities, particularly by utilizing depleted gas wells that can safely store natural gas reserves.
Develop a National Refinery Transition Plan
A long-term refinery transition strategy is recommended to align future infrastructure investments with changing energy demand patterns.
Prepare for Post-2030 Demand Shifts
As electric vehicles, renewable energy, and cleaner transportation technologies gain adoption, demand for petrol and diesel may gradually evolve.
The report recommends rebalancing refinery infrastructure to adapt to these changing consumption trends.
Prioritize Domestic Energy Security
Experts also suggest directing a larger portion of refined fuel output toward domestic needs when necessary and carefully evaluating future refining investments to avoid creating excess capacity that may become economically unviable after 2040.
Energy Transition and Future Challenges
India is simultaneously pursuing two major objectives:
Ensuring energy security for a growing economy.
Accelerating the transition toward cleaner energy sources.
Balancing these priorities will require significant investments in storage infrastructure, diversified import strategies, renewable energy expansion, and energy efficiency measures.
As global energy markets become increasingly complex, experts believe strategic preparedness will play a critical role in protecting India's long-term eco
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